BELARUS NEWS AND ANALYSIS

DATE:

02/04/2009

Belarus Telecommunications Report 2009 - a new market research report on companiesandmarkets.com

The telecommunications market in Belarus has come a long way since our last 2008 annual report. The main development has been Turkey?s Turkcell acquiring an 80% stake in the country?s smallest mobile operator Belorusskaya Telekomunikatsionnaya Set (BeST). With second largest mobile operator Velcom being owned by Telekom Austria, and Russia?s MTS having a 49% stake in market leader MTS Belarus, the mobile sector is by far the most liberal of Belarus? telecoms markets.

At the end of September 2008, BMI believes that the mobile market consisted of 7.886mn subscribers giving a penetration of 81.9% after y-o-y growth of 16.5%. In Q408, Turkcell reportedly announced that it was targeting a third of the mobile market by the end of H109. Although growth so far has been subdued we are expecting BeST to show strong growth in 2009, as Turkcell rebrands the operator, ups its marketing investments and expands its network coverage and capacity. 3G licensing has still not taken place but has been earmarked for September 2009 at the earliest, and BMI is expecting all of the operators to partake in the tender when it does come around.

Beltelecom has a monopoly on the fixed-line market and has been expanding its fixed-line infrastructure.

The incumbent reported over 3.7mn fixed-line subscribers at the end of September 2008, a figure BMI estimates will have reached 3.749mn by the end of 2008. We are forecasting fixed-line subscriber growth to continue slowing over the remainder of our five year forecast period as the developing mobile market begins to impact fixed-line subscriptions. In November 2008, Ivan Rak, the Belarusian first deputy minister of communications and informatisation, announced that Beltelecom would lose its monopoly on connecting international calls with foreign operators within two years. While this will not have a drastic effect on the fixed-line sector, it is a positive move in the right direction.

BMI has revised up Belarus? Independence of Regulator score in our Business Environment Rankings, from 10 to 20 out of 100. While this still remains the lowest score in the region, we are optimistic that Belarus will continue liberalising its telecoms market. Other positive steps taken include the adoption of new legislation on telecoms that takes EU legislation into account and in January 2009 it emerged that Belarus was to allow licensed ISPs to provide internet access over WiFi technology, something that had previously been the sole preserve of Beltelecom. Despite Belarus being one of only two countries in our Business Environment Rankings to see their overall scores increase, it remains at the bottom of the table.

That said, the gap between itself and Moldova has been greatly reduced.

The government reported a broadband subscriber base of 250,000 at the end of 2008 after y-o-y growth of over 127%. We are forecasting growth to slow over the remainder of our five year forecast period to 2013, when the market will hold just under 1mn subscribers, giving a penetration of 10.4%. Beltelecom dominates the internet sector, although there are a number of alternative ISPs such as cable operator Cosmos TV, which are rolling out their own networks. Beltelecom reduced its internet access interconnection fees by approximately 30% in 2008, which should enable alternative ISPs to continue encroaching on the incumbents market share. However, as long as Beltelecom remains under state control, BMI is not forecasting a rapid expansion in the country?s broadband subscriber base. The majority of the alternative ISPs are small, and centred around major urban centres like Minsk, so it is down to Beltelecom to deploy services to the majority of the country, an act the incumbent appears to be taking slowly.

Source:

http://www.pr-inside.com/belarus-telecommunications-report-r1159912.htm

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